Reply to: Made 10% on my BTL in the last year ...

[Old Hack]

Of course you do, for you're so clever, you have every base covered

[sasguru]

Are you saying that 25% stock market growth is a normal thing that can be expected for next 12 months?

One acronym explains that: QE.
I do have stocks and shares investments obviously but only as a long term bet.
I don't think anyone can predict what's going to happen there, if they ever did.

[AtW]

The point I'm making is that crowing on the internet about an investment that's considerably underperformed the stock market index is like crowing that you entered a race and came second last...

Are you saying that 25% stock market growth is a normal thing that can be expected for next 12 months?

[Old Hack]

I imagine SAS is referring to his mark-to-market, a simple process in which you value something at the price you can currently sell it (including the costs of sale) and compare it against what you purchased it for, including the costs of holding it for that period and also taking into account the opportunity cost of the original cash. Either that or it's a crude and half-meaningless 10% return

Sas is trying, unsuccessfully, to make people believe he has such a thing in the first place. Saying you have made 105 on your BTL is meaningless unless you have made 10% and given he's still pretending to own it, he hasn't realised anything in financial terms. Look at CGT on that 10%, look at Hector currently targetting landlords and it's a mugs game. We were yielding, net mind, 1% in our BTL's after all charges, mortgage interest, damages and tax was taken away. We did, however, sell one property for 40% more than we paid, and the other for 30% more than we paid as we sold up.

[sasguru]

The point I'm making is that crowing on the internet about an investment that's considerably underperformed the stock market index is like crowing that you entered a race and came second last...

Far from crowing I was just observing that the London housing market is on the move again.
A theoretical 10% is neither here nor there since I don't intend to sell the property - I look on it as part of my pension portfolio.
Personally I'd rather house prices crashed as buying oppos would present themselves with potentially much larger rises possible from a low base - a la 1995-2007, which I took advantage of.

[PEEL]

You haven't "made" anything at all. Yet.

What has happened is your agent has told you that the current market price is potentially higher than your purchase price ( less transaction fees and taxes of course! ). You have been Marked-to-market.

The agent is probably just looking to generate transactions.

What is the yield of the property?

I imagine SAS is referring to his mark-to-market, a simple process in which you value something at the price you can currently sell it (including the costs of sale) and compare it against what you purchased it for, including the costs of holding it for that period and also taking into account the opportunity cost of the original cash. Either that or it's a crude and half-meaningless 10% return

[PEEL]

The point I'm making is that crowing on the internet about an investment that's considerably underperformed the stock market index is like crowing that you entered a race and came second last...

I agree with this entirely, but it's not quite that simple. If you outperform your benchmark by 10% for two years running it is fantastic, but not if the standard deviation of return over 20 years is 80%. Your point is well made though.

[tomtomagain]

...or so I'm told by my agent (based on price I paid and likely selling price if I was to sell this year).
None of my other investments are yielding this much, so is it time to free up some resources and buy another?

You haven't "made" anything at all. Yet.

What has happened is your agent has told you that the current market price is potentially higher than your purchase price ( less transaction fees and taxes of course! ). You have been Marked-to-market.

The agent is probably just looking to generate transactions.

What is the yield of the property?

[Jog On]

And you could have had 100% in a Casino in 5 mins.

Stock market can drop and you won't get bailout, consumer real esate market on the other hand is something Govt has shown clear intent to support even if that means future generations will be paying for it.

The point I'm making is that crowing on the internet about an investment that's considerably underperformed the stock market index is like crowing that you entered a race and came second last...

Anyway - I'll let you come back with something clever...

[AtW]

Just pointing out the 12 month gain of 24.86% vs 10% in BTL.

And you could have had 100% in a Casino in 5 mins.

Stock market can drop and you won't get bailout, consumer real esate market on the other hand is something Govt has shown clear intent to support even if that means future generations will be paying for it.

[Jog On]

No, because that links shows that the index gone down from 15300 to 14900 - 2.5% in space of a few days...

bit of a short term view there!

Markets move in cycles. Just pointing out the 12 month gain of 24.86% vs 10% in BTL.

I don't see 10% as something to be smug about - especially when compared to the FTSE 250 index...

Just saying like...

[AtW]

Is this something to boast about?

FTSE 250 - 1 Year change +24.86%

No, because that links shows that the index gone down from 15300 to 14900 - 2.5% in space of a few days...

[vetran]

Anyway I reckon I'm going to go for a 2nd imaginary BTL - this one will be a real cardboard box from Lidl, missus will pay for that..

FTFY

[Jog On]

Is this something to boast about?

FTSE 250 - 1 Year change +24.86%

[AtW]

Very decent house for a singleton like yourself in a nice area - £250K.
That's chump change - why not buy?

Chump's change indeed, the only problem we have different standards - from my point of view a decent house in a nice local area is around £750k, really desireable - £2 mln.